Bio-orgies like last year's love fest feel great, but there can be an ugly after-effect: the orphans they leave behind. The IPO windows of 1991-92 and 1995-96 left vast numbers of their children struggling for Wall Street coverage and banking relationships once the markets cooled. So the question remains as to whether a new set of orphans will emerge from the new class of IPOs, many of which have seen their share prices tumble along with the general malaise in the equity markets.

There are many ways for a biotech company to get orphaned, the most abrupt being a late-stage clinical blow up. But a confluence of other factors can affect whether a company falls out of favor with Wall Street: declining stock prices and valuations, bio-bank consolidation and the departure of sellside analysts, to name a few.

The bad news is that all three have occurred since the '95-'96 IPO window. But the good news is that last year's crop of IPO companies is not dying on the vine, despite the increasing turnover of sellside analysts and heavy banking consolidation, and analysts at banks that underwrote IPOs seem to be maintaining coverage of their clients.

Blue Plate specials

Perhaps the most troubling factor is that many funds can't purchase, and many banks can't promote, securities that fall below $5, due to penny stock rules and liability issues. And some blue blood firms that are especially sensitive to capital preservation for their clients often raise the bar to $10.